BACKGROUND: In October 2006, a new rotavirus vaccine was introduced in Nicaragua and was available free to all age-eligible children. We assessed vaccine uptake and trends in acute gastroenteritis (AGE) to assess vaccine impact. METHODS: We analyzed national data from the period 2001-2007 on the total number of AGE episodes and on RotaTeq vaccine dose administration during 2006-2007. RESULTS: After the introduction of RotaTeq, 1-dose vaccine coverage rates rapidly increased to 80% among age-eligible children. During the 2007 rotavirus season, when combined 2- and 3-dose vaccine coverage among children aged 0-11 months was approximately 26%, the total number of AGE episodes among children aged 0-11 months decreased by 23%, compared with a decrease of 6% among unvaccinated children aged 12-59 months. Furthermore, a 12% decrease in the number of all-cause hospitalizations for AGE was noted among children aged 0-11 months, whereas a approximately 5% increase was observed among children aged 12-59 months. CONCLUSIONS: The high rate of vaccination among age-eligible children soon after vaccine introduction in Nicaragua indicates an efficient immunization program. However, in the age group at risk of rotavirus disease, vaccine coverage during the 2007 rotavirus season had yet to reach a level sufficient for making firm conclusions about vaccine impact. Epidemiologic studies to evaluate vaccine effectiveness and ongoing surveillance as vaccine uptake increases will allow a better assessment of vaccine impact.